TO: Members of the Wisconsin Legislature inSecurity Health Plan’s Service Territory and Joint Finance Committee Members

RE: Support for Governor Walker’s Reinsurance Proposal

Governor Scott Walker, in his State of the State Address today, announced as part of his “Health Care Sustainability” plan a state-based reinsurance program. Security Health Plan strongly supports this proposal.

Premiums for our members and your constituents would have been significantly higher from 2014 through 2017 had a Federal reinsurance program not been in effect at that time. Our modeling shows premiums would have been nearly 20 percent higher in 2014 and 12 percent higher in 2015.

States that have adopted similar programs to what Governor Walker is proposing have experienced significant rate reductions in their 2018 premiums. Alaska and Minnesota, two states that have established similar re-insurance programs, have seen upwards of a 20 percent rate reduction for 2018 premiums over what they otherwise would have been without the program. Our estimate is that this program would have similar impacts in Wisconsin, leading to a more stable market for consumers.

As one of the largest carriers of the Affordable Care Act individual and family products in Wisconsin, we believe the implementation of a state-based reinsurance program is crucial to maintaining the affordability of health insurance for our members and your constituents.

We would welcome an opportunity to visit with you regarding this proposal and answer any questions you may have about the impact on your district and constituents. And we would ask your support of this very important program.